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Wednesday July 13, 2011 | 02:59 PM

Sen. Olympia Snowe, R-Maine, says closing tax loopholes – though not raising tax rates – could be part of a debt limit deal she could back.

But as negotiations over raising the debt ceiling continue between President Obama and Senate and House leaders, Snowe said in an interview this afternoon that finding a way to avoid defaulting on the federal government’s obligations while trying to devise a plan to cut spending and reduce the debt going forward shouldn’t be happening as a frantic, last-ditch scramble.

Intense work should have begun at the beginning of the year, and all lawmakers should have a chance to help craft plans that are debated in House and Senate committees and brought to the floor, Snowe says, rather than behind-close-door, final-hour negotiations between just a few leaders and the president.

“That creates a lot of problems coming down to the wire,” Snowe said. “We don’t even know what has been drafted. I express frustration because this isn’t the way the process should have worked at the outset.”

Asked about Senate Minority Leader Mitch McConnell’s proposal for a backup plan to give Obama the authority to raise the debt ceiling in increments unless Congress votes against the raises with a veto-proof majority, Snowe said only that, “He is offering options, I guess, to this whole process. In the meantime, I think it’s important for the talks to continue between the president and congressional leadership.”

And while she isn’t happy with the process for the debt ceiling negotiations, Snowe, a member of the Senate Finance Committee, said that she could support raising additional revenues by closing tax loopholes and ending subsidies such as those granted ethanol production and extended to the country’s largest oil companies. But Snowe said she would not agree to raising tax rates as part of a deal, and criticized the proposal by the White House to end the Bush era tax cut for families with income over $250,000.

The economy is too fragile for such a tax hike, which would affect many small business owners, too, Snowe said.

But House Republicans have defined tax hikes they will not support as including the type of loophole and subsidy closing that Snowe, as well as Sen. Susan Collins, R-Maine, have said they could support.

Collins said in an interview Monday that while she agrees that tax rates should not be raised, she disagrees with the view that eliminating certain tax loopholes – she too mentions the ethanol and oil industry subsidies as examples - also constitutes a forbidden tax hike.

Meanwhile, Democratic Rep. Chellie Pingree of the 1st district has said that for her part she remains “strongly opposed to any agreement that cuts Social Security benefits,” an issue Obama has put on the table as a possibility along with cuts to Medicare. Social Security hasn’t contributed to the deficit and “we shouldn’t let politicians tap into it to pay for tax breaks for millionaires,” Pingree said on Sunday after House Speaker John Boehner, R-Ohio, walked away from negotiations over a comprehensive debt ceiling deal that aimed to produce $4 trillion in total savings.

Rep. Mike Michaud, D-2nd, said Sunday that, “It really shows how broken Washington is that we can’t reach a significant, bipartisan deal on one of the biggest issues facing the future of our country and our economy. I'm hopeful a balanced way forward can be worked out so that Washington stops simply kicking the can down the road.”

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Kevin Miller is Washington bureau chief for the Portland Press Herald and MaineToday Media. He has worked as a journalist in Maine for 6 ½ years, covering the environment, politics and the State House. Before arriving in Maine, he wrote about politics, government and education for newspapers in Virginia and Maryland.
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